Sony has launched the Cyber-shot DSC-T500, a 10-megapixel camera that offers 720p movie recording at 30 frames per second in the MPEG4 H.264 codec.

Similar to the recently launched video-enabled Nikon D90, Sony exec Phil Lubell says the camera was created as a result of consumer demand:

"Our research revealed that people like to shoot video with their point-and-shoot cameras, but were very dissatisfied with the video quality and the resulting large files. Our new T500 fulfills this customer need for a digital camera that delivers high-quality movies in a small form factor."

The camera can only record film clips up to 10 minutes in length but does offer zoom in recording mode as well as still capture and high-sensitivity shooting for low light conditions.

Supporting memory sticks of up to 16GB, the 3.5-inch touch panel LCD screen, 5x optical zoom lens, image stabilisation and face detection technology.

Available in black with a brushed metal finish it will be available in late September for about $400.